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Nidhi Company Registration

Nidhi Company, a non-banking finance sector company, regulated under Section 406 of the Indian Companies Act, 2013, accepts deposits from and lends to its members only, for their mutual benefit.

A Nidhi Company is a non-banking financial company (NBFC) operating in India, governed by the Nidhi Rules, 2014, and recognised under Section 406 of the Companies Act, 2013. Functioning as a public limited company, its core objective revolves around promoting thrift and savings among its members while providing financial assistance to them through lending.

To get a Nidhi Company registration in India, a minimum of seven members are required, and the company must possess a net owned fund of at least ₹10 lakhs. Unlike other NBFCs, Nidhi Companies are limited in their operations, restricted to borrowing and lending activities among their individual members only. They cannot accept deposits from the general public or engage in other financial activities. Although exempted from RBI registration, Nidhi Companies must adhere to specific regulations provided by the Ministry of Corporate Affairs (MCA) in India.

Benefits of a Nidhi Company Registration

Affordable Borrowing

Being a member of a Nidhi company allows individuals to borrow money at a lower rate compared to banks. This provides a significant advantage during times of financial need, as different members may require funds at various points in time.

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Promotes Saving

Nidhi companies encourage all their members to save money and cultivate a frugal lifestyle. By fostering a mutual benefit society, Nidhi registration enables members to lend or borrow money and receive financial assistance among themselves.

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Simplified Process

Nidhi company registration online has a much simpler process than the banks or unauthorised lenders. Due to the well-organised incorporation processes, members of a Nidhi company can optimise the potential of their financial resources and have access to lower interest rates when they require cash for their own requirements.

Nidhi Company Incorporation Requirements

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  • In India, a minimum of seven members are needed for registration of Nidhi.

  • It needs 3 directors

  • It can have up to 200 members

  • A minimum equity share capital of ₹5 lakhs must be paid up in full

  • Within a year of Nidhi registration, Net Owned Funds (NOF) must increase to ₹10 lakhs

  • The following conditions must be met:
    1. Unencumbered term deposits must make up at least 10% of the total amount of the company's existing deposits
    2. One to twenty is the suggested NOF to deposit ratio. This includes equity share capital and free reserves. It excludes accumulated losses and intangible assets

  • Additionally, at least 10% of the total deposits must be held in the fixed deposit account of a nationalised bank.

Nidhi Company Registration Procedure

Step 1: Name Reservation

We help you reserve your desired name with the Ministry of Corporate Affairs (MCA).

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Step 2: DSC and DINs

We assist you in obtaining 1 Digital Signature Certificate (DSC) and 3 Director Identification Numbers (DINs).

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Step 3: Documents and Approval

We provide support throughout the documentation process. It helps you obtain in-principle approval from RBI.

Documents Required for Nidhi Company Registration in India

The following documents has to be submitted from all the directors

  • PAN card (self-attested copy)

  • Driver's license/Voter ID/Aadhaar card/passport (self-attested copy)

  • Bank statement/telephone bill/mobile bill/electricity bill (self-attested copy)

  • Passport-size photograph

  • Specimen signature certificate

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